[Kapitan]

China v the West Does the Dragon have enough puff?

Currently speaking the economy of China has over recent years taken a bit of a hit the economy has slowed down slightly, especially since 2008 and the subprime mortgage debacle however China maintains its top spot in purchasing parity, but remains the second largest economy in the world.

In 2018 the Chinese GDP fetched in some $13.5tr USD now what we do know is the Chinese stock markets love to invest in western government securities, mainly ten year securities, so a lot of the national debt of the United States of which around 52% is owned by foreign governments China owns around 22% of the 52% which is roughly $1,202bn USD

In 2017 the Chinese economy grew by 6.9% that slowed in 2018 Q3 slightly to 6.5%, so what we know is that the Chinese economy is still on the rise, what is also worth noting is that China also has the largest banking system in the world with the most deposits to give you some figures the banking assets of Chinese banks total nearly $41tr USD while liquid funds (deposits) make for $27.4tr USD, coupled with the fact it is also the world’s largest exporter and has natural resources of over $25tr USD in raw materials including gold, coal, gas, oil etc.

Some more numbers for you, the current public debt of China is around 15.8% of GDP in comparison the United states public debt is 125% of GDP which is quite alarming, the USA also has a gross external debt of some $21.3tr USD where as China gross external debt is $1.45tr USD, both countries enjoy AAA status from the ratings agencies and a stable outlook.


So what does this mean for defence?

The United States is known as number 1 it has 10 nuclear powered aircraft carriers in its fleet, along with 66 active destroyers as well as a large force of SSN’s giving the United States navy a total including the Military Sea lift command some 477 vessels many of which are ocean going heavy warships.

The United States spends as of the latest FY2019 approval $675bn USD on defence or nearly 6% of GDP, in contrast the Chinese spends $172bn USD as of the late 2018 announcement which is the largest increase some 11% in the last 3 years.

Recently we have seen the immergence of a back engineered aircraft carrier now China fields two such carriers, and also the immergence of new more powerful and stealthy Destroyers and Frigates the type 055 is such an example.

What the numbers suggest is that while China has a hull lead on the USN (515 vessels) the reality is the majority of the fleet is made up of sea going and coastal craft, for example 110 of the listed active vessels are under 1000 tons, while the type 056 corvettes numbers some 43 vessels out of a planned 60 but again these are of small tonnage 1,500tons and not likely to range too far from home.

Vessels to watch for in my opinion are the larger types the 40 type 054 Frigates are quite powerful assets, but the key player will be the new 13,500ton type 055 Destroyers, these are rumoured to be more capable than the Arleigh Burke flt III and are armed with a 112 cell VLS system and a AESA flat phased array radar system, operating on VLF S band dubbed “Chinese Aegis” and said to be able to detect the new F35’s, so far only 8 are planned and 6 are under construction simultaneously 1 is in sea trials, which means the Chinese has a large ship building capacity and dry dock space that’s for certain because the earlier type 052D is still being built and they should number 26 when the production run ends.

Submarines are not of a major concern to China in fact China only has some 13 SSN’s the bulk of its submarine fleet is made up of conventional boats, the current type 093 Shang class 6 are in service no more to be built they are backed up by the dated type 091 Han class which remain in service, the new type 095 is awaiting the go ahead but again only 5 are planned.

The main deterrent is carried by the sole type 092 Xia class along with 4 type 094 Jin class with another 4 building this will be succeeded by the type 096.


Are we likely to see more carriers and what would their impact be?

Absolutely the type 003 is a massive project, two are in the early stages of construction they are larger than the Ford class at 110,000tons and nuclear powered they will also have EMALS another 2 are on the cards as well.
Also the type 002 is being built this is an 85,000ton carrier a sort of in between carrier and will carry around 60 aircraft.

This will bring the carrier force to a total of 7 by 2030’s and given the quick nature of the building of such ships I would put money on the fact the Chinese vessels will come in fairly on time, this will also shift the balance of power in the region dramatically to the Chinese favour, even with Japan now adopting aircraft carriers the Japanese are unlikely and unwilling to match platform for platform the Chinese, also the United states is split into many areas of operation and would only be able to dedicate one or two carriers to the area relying heavily of Japan and south Korea as well.

I would keenly watch the South Koreans as well I personally think we will see a small carrier come out of South Korea in the nearish future (10-15 years) I personally think it will be of around 30,000tons and carry something like 30 F35B Type aircraft, but I reckon it would be built that or the current Dokdo class may be converted to handle a few F35B.

Any other notable mentions?

Well yes we are also seeing the creation of a large ocean going Amphibious force from the Chinese navy the type 075 LPA vessels are of large scale some 40,000tons displacement and 250m in length, likely to be armed with around 30 helicopters this is like a mistral but on steroids, couple this with the type 071 which is 25,000tons and 210 meters long they will be a strike force all of their own, so far 3 type 075 are under construction along with the remaining 3 type 071 this means 5 type 071’s are currently active.

China also has a large force of other types of landing craft ranging from hovercraft to the much larger medium sized landing ship they would be equivalent to the round table class of the RFA in the UK, these mainly the type 073 range from 850tons to 2000tons displacement some 13 are in service of the type 073 alone while others of the type 072 number some 47 vessels again raging from 3000tons to 7000tons.

Conclusion

China is definitely one to watch I have been following them for about ten years, their speed at building and also their current stance in the south china sea tells me they are gearing up for a show down, could this be a new soviet union? I don’t think so but the numbers alone are some what disturbing and I don’t think the United States could afford another half century arms race, I now think countries that are allied to the United States should augment into closer relationships with the USN for any eventuality, nations like Canada and Germany must up their game dramatically if they want to stay in NATO, I also think playing with the Ukraine situation and Russia is a dangerous mix in the advent of any conflict we may see China ally on the Side of Russia which gives you and even bigger head ache, and we would also likely see troubles in the Persian gulf with Iran joining in as well.

Any conflict between China would spell major losses, they currently have the largest standing army in the world and also one of the largest air forces numbering over 3,000 aircraft (the US has some 5,000 if you include the air national guard and excluding the USMC and USN).

What I question the most though is the quality, Krushchev said we are churning out missiles like sausages however the quality of that sausage left much to be desired, I do think China could be in a similar boat with build quality.